We’ve all experienced what is known as Bad Debt… the kind which costs you dearly in your hip pocket, yet never seems to move you forward with your wealth creation goals. So, if you have Bad Debt (and I’ll admit there have been times when I was younger that I have been in this situation) you have to get out by whatever means works for you.

So put together a plan—then stick with it. Commit to do whatever is necessary to complete the plan. Above all remember, a plan is only as good as your ability to stick to it. Just like diets, all of them work in theory. The true test, however, is which diet will you stick with? No matter how effective the plan is on a daily basis, if the regimen is outlandish and impractical, you will not stick with it no matter how good it looks on paper.

When evaluating a get-out-of-debt plan, you should look for the following characteristics:

Is it specific?

Is it easy to prepare?

Is it simple to understand?

Is it visually pleasing and suitable for refrigerator posting?

Can its results be measured?

Does it have a specific finish date?

When it comes to this kind of effort, the simpler the better. But don’t sacrifice the quality of the plan in the process.

The Rapid Debt Repayment Plan

Here is a plan that fits all the above criteria. It’s a simple plan and effective because it works. It’s called the Rapid-Debt Repayment Plan. This plan is simple because there are only four rules. If you adhere closely to all four rules, you will get out of debt in record time.

Rule # 1…

No more new debt: Unless you are willing to stop adding to your unsecured debts, you’re really out of luck when it comes to debt-proofing your life. Furthermore, if you don’t stop adding to the problem, you’ll be like the homeowner with the kitchen fire—except instead of putting out the blaze that’s ready to destroy the entire structure, you’ll be pouring gasoline on it. It might be manageable for a while, but you’ll be on your way to a full-on raging inferno. The rule is simple: add no new unsecured debt.

Rule # 2…

Pay the same amount every month: Ignore the declining minimum amount due on the monthly statement until the debt is paid. If you are following rule number 1 religiously, you will soon notice something peculiar about your minimum monthly payment: it will start to shrink. Credit card companies in particular are not that interested in you paying off your debt. They’d like to keep you in the position of paying them a tidy sum of interest every month for the rest of your life. That is why your minimum monthly payment may be a percentage of the remaining balance, generally 2 to 4 per cent.

Rule # 3…

Line up your debts according to size: Put the debt with the shortest pay-off time at the top and the one with the longest term at the bottom.

Rule # 4…

As one debt is paid, take that payment and redirect it to the regular payment of the next debt in line: This rule requires that until you are completely debt free, you pay the same total amount toward your debt until all debts are paid. A most importantly, remember that you will get there sooner than you think.